KUALA LUMPUR: IOI Corporation Bhd's earnings jumped 134% to RM604.30mil in its first quarter ended Sept 30, 2012 (Q1FY13) from RM258.10mil a year ago, boosted mainly by foreign exchange gains while it expects a challenging year ahead.

The plantation heavyweight reported on Monday its revenue fell 18.7% to RM3.370bil from RM4.147bil a year ago. Earnings per share were 9.44 sen compared with 4.02 sen.

IOI Corp's pre-tax profit of RM730.8mil was 72% higher than the RM424.1mil a year ago.

"The increase is due mainly to translation gain of RM259.2mil (Q1 FY2012 - loss of RM271.7mil) on foreign currency denominated borrowings and higher contributions from all major segments other than plantation segment," it said.

On the plantation segment, it said profit from this division fell 28% to RM401.2mil from RM557.1mil due mainly to lower fresh fruit bunches production coupled with lower crude palm oil and palm kernel prices.

"Average CPO price realised for Q1FY13 was RM2,941 a tonne as compared to RM3,149 a year ago," it said.

However, profit from its resource-based manufacturing operations jumped from RM33.2mil in Q1FY12 to RM73.2 million in Q1FY13 due mainly to higher margins from oleochemicals and specialty fats sub-segments. It was also aided by net fair value gain in forward foreign exchange and commodity forward contracts.

The property development segment reported a 9% rise in profit to RM111.8mil mainly due to higher share of results from Singapore jointly controlled entities.

The Q1, FY2013 pre-tax profit of RM730.8mil was 38% higher than RM528.7mil in the preceding quarter ended June 30, due mainly to translation gain of RM259.2mil versus RM233.8mil on foreign currency denominated borrowings, which was partially offset by non-recurring items recognised in Q4 FY2012.

"These non-recurring items include fair value gain on investment properties of RM165.0mil and gain arising from dilution of interest in an associate company of RM116.3mil.

"The plantation segment reported a 27% increase in operating profit from RM315.8mil for Q4FY12 to RM401.2mil for Q1FY13, contributed mainly by higher FFB production by 34% despite a lower CPO price realised," it said.